wall street

BANK OF NOVA SCOTIA, $52.25, Toronto symbol BNS, has agreed to buy ING Bank of Canada (which operates as ING Direct) from its Netherlands-based parent, ING Group. ING Direct offers a wide variety of no-fee banking services, mainly over the Internet. It has 1.8 million customers and $30 billion in deposits. Bank of Nova Scotia will keep ING Direct as a separate business and will not merge it with its regular banking operations. The bank will pay $3.1 billion for ING Direct when the deal closes in December 2012. However, ING Direct holds cash of $1.2 billion, so the real cost is around $1.9 billion. To fund this purchase, Bank of Nova Scotia plans to sell up to $1.7 billion of common shares for $52.00 each. That would increase the number of shares outstanding by 3%....

CAMECO CORP., $21.48, symbol CCO on Toronto, has agreed to buy the Yeelirrie uranium project in Western Australia from BHP Billiton, symbol BHP on New York. BHP is a recommendation of Wall Street Stock Forecaster, our newsletter that focuses on U.S. stocks. Cameco is the world’s largest uranium producer. It supplies over 25% of global production and has large, high-grade reserves, low-cost operations, significant market share and a number of uranium mines. Cameco will pay $430 million U.S. for Yeelirrie when the deal closes by the end of 2012. The company held cash and investments of $894.9 million (Canadian) on June 30, 2012, so it can comfortably afford this purchase....

Vodafone Group plc (ADRs), $29.29, symbol VOD on Nasdaq (ADRs outstanding: 4.9 billion; Market cap: $143.5 billion; www.vodafone.com), is a leading provider of mobile telecommunications services, including cellular phones and paging. The company has 448.8 million subscribers and operates in 26 countries. Vodafone also owns 45% of Verizon Wireless, which provides mobile-phone services in the U.S. Verizon Communications Inc., symbol VZ on New York, owns the remaining 55%. Verizon Communications is a recommendation of our Wall Street Stock Forecaster newsletter. In July 2012, Vodafone completed its purchase of Cable & Wireless Worldwide, a U.K.-based firm that sells telephone and Internet services to corporations and governments. Cable & Wireless’s extensive fibre optic networks look like a good fit with Vodafone’s mainly wireless businesses. The deal also lowers Vodafone’s reliance on consumers....

In the wake of the financial crises that have occurred in recent years, there has been a good deal of pressure in favour of stricter securities regulation. One company that serves the financial community could benefit substantially from tighter securities regulations. BROADRIDGE FINANCIAL SERVICES INC. (New York symbol BR; www.broadridge.com) gets 70% of its revenue from its Investor Communication Solutions division, which distributes proxy materials such as ballots to investors in stocks and mutual funds. It also counts the votes. Broadridge’s ProxyEdge software helps centralize and simplify shareholder voting, particularly in meetings involving multiple ballots. The company mails and processes material for 60% of proxy votes worldwide....

HEWLETT-PACKARD CO., $17.58, New York symbol HPQ, reported better-than-expected earnings this week. However, rising demand for tablet computers and mobile phones continues to hurt sales of its printers and personal computers. That caused the stock to fall 10%. In its fiscal 2012 third quarter, which ended July 31, 2012, Hewlett lost $8.9 billion, or $4.49 a share. That’s mainly because it wrote down $8 billion of goodwill related to its $13.9-billion purchase of Electronic Data Systems (EDS) in August 2008. It also wrote down the value of the Compaq brand by $1.2 billion. Without these items, Hewlett would have earned $2.0 billion, down 13.5% from $2.3 billion a year earlier. Earnings per share fell 9.1%, to $1.00 from $1.10, on fewer shares outstanding. That beat the consensus estimate of $0.98....

AGRIUM INC., $98.86, Toronto symbol AGU, rose 2% this week on news that activist investment firm Jana Partners LLC now owns roughly 4% of Agrium’s stock. This is the same company that pressured McGraw-Hill (New York symbol MHP) to split itself into two new firms: one that will produce financial-information products and one that will publish textbooks for colleges and schools. McGraw-Hill is a recommendation of Wall Street Stock Forecaster, our newsletter that focuses on U.S. stocks. Jana now wants Agrium to spin off its retail division as a separate company. These stores sell seed, fertilizer and other products to farmers. They also supply two-thirds of Agrium’s revenue and half of its earnings....

GOOGLE INC., $677.14, Nasdaq symbol GOOG, recently completed its $12.5-billion purchase of cellphone maker Motorola Mobility Holdings. This week, the company announced a new plan to make Motorola Mobility more profitable. This initiative involves including cutting 20% of its workforce and closing 30 of its 90 plants. Motorola Mobility will also shift its focus from regular cellphones to more profitable products like smartphones and tablet computers. It may also sell its home TV business, which makes set-top boxes for cable companies. Google expects to pay $275 million in severance and other costs. That’s equal to 8% of the $3.35 billion, or $10.21 a share, that it earned in the three months ended June 30, 2012....

HILLSHIRE BRANDS CO., $25.32, New York symbol HSH, makes a variety of packaged meat products. Its main brands include Ball Park hot dogs, Jimmy Dean sausages and Hillshire Farm deli meats. Other products include Sara Lee frozen desserts and Chef Pierre pies. The company took its current form on June 28, 2012. That’s when Wall Street Stock Forecaster recommendation Sara Lee Corp. (New York symbol SLE) split itself into two separate companies: Hillshire Brands and D.E. Master Blenders 1753 N.V. (see below). Following the spinoff of D.E. Master, the remaining Sara Lee shares were converted into Hillshire stock and consolidated on a 1-for-5 basis. Adjusting for the breakup, Hillshire’s sales would have risen 4.0% in its 2012 fiscal year, which ended June 30, 2012, to $4.0 billion from $3.9 billion in fiscal 2011. If you exclude the contribution of an acquisition, sales would have risen 1.2%. The company also raised its prices to cover higher ingredient costs....

Calloway Real Estate Investment Trust, $29.80, symbol CWT.UN on Toronto (Units outstanding: 107.1 million; Market cap: $3.2 billion; www.callowayreit.com), owns, develops and operates big-box outdoor malls across Canada. In all, Calloway owns 118 shopping centres and two office buildings, with 25.6 million square feet of leasable area. Its malls are mainly located in the suburbs of larger cities and have lots of room for parking and additional building. The trust gets 59% of its revenue from Ontario, 14% from Quebec, 9% from B.C., 4% from Manitoba, 4% from Saskatchewan, 3% from Newfoundland and Labrador, 3% from Alberta, 2% from Nova Scotia, 1% from New Brunswick and 1% from Prince Edward Island....

We developed our TSINetwork ratings to help investors quickly and easily identify stocks with the asset size and investment quality to weather market downturns and changing industry conditions. Stocks of this quality are the best investments for long-term profits. You will find our TSINetwork ratings (Highest Quality, Above Average, Average and Extra Risk) next to each stock we recommend in our newsletters. Obviously, we take a number of factors into account before we assign these ratings. Many involve a company’s financial profile....